Health economists count cost of research cuts

Labor’s threatened cuts to medical research could cost the economy $129 billion and 1600 jobs by 2020, health economists have warned ahead of a rally in Brisbane today.

The rally is the latest in a string of protests nationwide following reports that $400 million will be axed from the National Health and Medical Research Council’s budget over the next three years.

It will coincide with the announcement of a research workforce strategy aimed at ensuring Australia has enough doctoral-qualified people to staff universities, drive innovation and provide skills for industry.

Innovation Minister
Kim Carr
will release the strategy in Canberra this morning. He will also announce $1 million in funding to help prepare mathematicians for industry and $200,000 for policy development work by research training experts.

The move comes as the medical research fraternity rallies against rumours of planned cuts to the research council’s $700 million annual budget in the May federal budget.

Queensland University of Technology professor of health economics Nicholas Graves said the proposed cuts would lead to less informed health policy decisions and therefore a rise in health expenditure.

Expenditure of $107 billion in 2008-09 will rise to $226 billion in 2020 at its current growth rate of 5.4 per cent. But if spending increased by just 1 percentage point more a year due to poor decision making, gross expenditure would be $129 billion higher by 2020, Professor Graves said.

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“If they reduce the funding by $400 million, which is what the rumours are, then that’s the equivalent of over 1600 post-doctoral positions gone," he said.

Post-doctoral study is the crucial step between completing a PhD and moving into a formal research job.

“Of course the cuts would be from across the board but that’s just an example of how big the impact would be," Professor Graves said.

Research Australia, an alliance of organisations and companies involved in medical and health research, has launched an online petition to discourage the government from funding cuts.

Research Australia chief executive Rebecca James said a reduction in funding would jeopardise the talent pipeline for many years to come.

“If these cuts go ahead, it will end the careers of many researchers," she said.

The government’s research workforce development strategy identifies weaknesses in the existing system, including a lack of demand for careers in research.

The government intends to work with employers, professional groups and universities to identify what research skills are most needed in individual disciplines and sectors.

Opposition health spokesman
Peter Dutton
was yesterday quoted as saying it would be “unacceptable" to cut a single dollar from medical research.and the opposition would fight any such move. But opposition finance spokesman Andrew Robb said the opposition would not declare its hand on what it may or may not block in the budget until it had seen the detail.